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Costs of Inflation: Shoe-leather Costs and Menu Costs
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Costs of Inflation: Shoe-leather Costs and Menu Costs
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11. Unemployment and Inflation / Costs of Inflation: Shoe-leather Costs and Menu Costs / Problem 5
Problem 5
During hyperinflation, a business must update its prices daily. What is the impact on menu costs?
A
Menu costs decrease as businesses stop updating prices.
B
Menu costs are eliminated as businesses switch to digital pricing.
C
Menu costs increase significantly due to frequent price changes.
D
Menu costs remain constant regardless of inflation rates.
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